Category: Economics

Vanessa Jones is the assistant chief accountant at IBT Company

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Vanessa Jones is the assistant chief accountant at IBT Company, a manufacturer of computer chips and cell phones. The company presently has total sales of $20 million. It is the end of the first quarter and Vanessa is hurriedly trying to prepare a trial balance so that quarterly financial statements can be prepared and released to management and the regulatory agencies. The total credits on the trial balance exceed the debits by $1,000.

In order to meet the 4 p.m. deadline, Vanessa decides to force the debits and credits into balance by adding the amount of the difference to the Equipment account. She chose Equipment because it is one of the larger account balances; percentage-wise, it will be the least misstated. Vanessa plugs the difference! She believes that the difference is quite small and will not affect anyone’s decisions. She wishes that she had another few days to find the error but realizes that the financial statements are already late.

Instructions

 

Who are the stakeholders in this situation?

What ethical issues are involved?

What are Vanessa’s alternatives?

Monetary policy

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Monetary policy is largely determined by the Federal Reserve Bank (Fed) in the United States. For this discussion, let’s cordially debate the necessity of the Fed.

For your initial post address the following:

How does the Fed control the money supply? Be sure to explain how they can expand or restrict the money supply.
How does the banking system create money?
List two to three pros and cons of the Federal Reserve Bank.
What is your conclusion: is the Fed necessary? Support your opinion.

Leading stock exchanges in the United States today.

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Identify and briefly compare the two leading stock exchanges in the United States today. Select one company for each exchange and discuss how the company’s stock has performed in the last 12 months. Would you consider investing in this company? Why or why not?
What is free cash flow? Why is it the most important measure of cash flow?
If you were starting a business, what tax considerations might cause you to prefer to set it up as a proprietorship or a partnership rather than as a corporation?
A sinking fund can be set up in one of two ways. Discuss the advantages and disadvantages of each procedure from the viewpoint of both the firm and its bondholders.
In theory, market risk should be the only “relevant” risk. However, companies focus as much on stand-alone risk as on market risk. What are the reasons for the focus on stand-alone risk?

 

 

Ethical behavior

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As you come to the end of the course, reflect on how this course has impacted your ethical behavior. Ask yourself what you will stop doing, start doing, and continue doing going forward. What three small things did you take from this course that will help to commit these changes in your understanding of what constitutes good ethical behavior when dealing with different IT scenarios? Your journal entry must be at least 200 words. No references or citations are necessary.

 

Measuring GDP.

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Robert Kennedy, when seeking the Democratic presidential nomination in 1968, remarked that GDP measures everything except that which makes life worthwhile. What do you think he meant by this statement? What do you think he feels is missing when measuring GDP.

 

The trade in opium between the British,the Indians, and the Chinese

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Can you identify the groups that gained from and supported the trade in opium between the British,the Indians, and the Chinese?
Compare the persistence in the export of Opium to China and the persistence of the export of Opium and its derivative into the USA?
In what way could you say that the methods are the same in China as in the USA today.

The quality of institutions is important for economic growth

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Economist keep saying that the quality of institutions is important for economic growth, but when you look at countries all around you, it is unclear what economists mean by “quality institutions”. China, a very corrupt country, with autocratic political system is among the fastest growing countries in the world. Isn’t this country growing in spite of it’s lousy institutions? Are economist wrong? Why?